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Backd Small Business Loans: 2024 Review

Name: Fundbox
Item: Backd
Rating: 4.6
Author: Sarah George

Written by

Sarah George

Edited by

Robert Thorpe

Updated Nov 27, 2024

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4.6

Bankrate Score

Bankrate Rating = 4.6/5

Bankrate scores are objectively determined by our editorial team. Our scoring formula weighs several factors consumers should consider when choosing financial products and services.

Accessibility

Affordability

Customer experience

Transparency

Flexibility

How Bankrate Scores work

Overview

Backd is an online lender that offers fast, short-term business funding to business owners with a credit score of 600 and above. Its options include a working capital loan, business line of credit and buy now, pay later option to help businesses spread out the cost of purchases.

Lender Details

Loan amount

$10,000-$2 million
Interest rate

1.10-1.24 Factor rates | 30.00% APR
Term lengths

6-16 months
Min. annual revenue

$100,000
Min. time in business

1 year

Who Backd is best for

Backd business funding works well for businesses looking for a business line of credit or working capital loan with high loan amounts. It specializes in fast funding, approving loans instantly and providing funding within 24 hours.

Backd is also a good option for businesses with fair credit — one year in business and a credit score of 600 for applicants are the minimum requirements.

Who Backd may not be best for

Businesses looking for a long-term loan won’t find what they’re looking for with Backd, as it only offers terms up to 16 months. It also doesn’t offer secured loans that might qualify you for better rates.

In addition, businesses with low revenue might not qualify for its business line of credit, which requires $300,000 minimum in annual revenue. Its working capital loan requires just $100,000 in annual revenue.

Backd: in the details

Loan amount

$10,000-$2 million

Interest rate

1.10-1.24 Factor rates | 30.00% APR

Term lengths

6-16 months

Fastest funding

1 business day

Min. annual revenue

$100,000

Min. time in business

1 year

Personal credit score

600

Backd pros and cons

Pros

High maximum loan amounts
Funding within 24 hours
Flexible repayment features

Cons

Short-term loans only
Few types of loans
Potentially high costs with factor rates

Business loan types offered

Backd specializes in short-term loan options that offer competitively high maximum loan amounts for qualifying businesses. It also offers an alternative type of business loan to fund smaller business purchases.

Business line of credit
Working capital
Buy Now, Pay Later

Loan quick facts

Amounts: $10,000 to $750,000
Terms: Repay in 6 or 12 months
Interest rate: 30.00% APR

Backd business line of credit overview

Backd’s business line of credit offers a higher possible credit limit than other lenders. Many lenders set their maximum limit at $250,000 or $300,000. Once businesses draw funds, they make weekly repayments for six or 12 months. This is a common repayment schedule, though some of the best business lines of credit offer more flexibility with monthly repayments. Businesses will need at least $300,000 in annual revenue and a year in business to qualify for this loan, which could leave newer businesses ineligible.

Loan quick facts

Amounts: $10,000 to $2 million
Terms: Up to 16 months
Factor rate: 1.10 to 1.24

Backd working capital overview

Many businesses can qualify for high-value funding for everyday expenses. Backd only requires $100,000 minimum in annual revenue and one year in business, a low revenue requirement.

Businesses can get up to $2 million in funding without putting up collateral, which is hundreds of thousands of dollars higher than most banks. To get a higher working capital loan, a business would need to apply for an SBA loan, which goes up to $5 million.

Not every bank offers loans specifically for working capital. But this loan charges a factor rate instead of an interest rate, which doesn’t account for additional loan fees like an APR does. This makes it difficult to compare borrowing costs with other loans.

Loan quick facts

Amounts: Up to $1.5 million
Terms: 12 months
APR: Not stated

Backd Buy Now, Pay Later overview

BackdPay helps businesses make purchases that will grow their business without having all of the capital on hand. You can repay over the course of 12 months, paid with automatic payments.

The main difference between this type of Backd business funding and a business credit card is that some credit cards come with an interest-free period — usually anywhere from six to 18 months.

Do you qualify?

Backd keeps relaxed requirements to qualify for its business funding. The minimum criteria businesses need to apply:

1 year of time in business
600 minimum credit score
$100,000 to $300,000 in annual revenue, based on loan
Based in the U.S.
Business bank account
Cannot be in these industries: Adult entertainment, cannabis, consulting, flea markets/conventions, financial services, government entities, legal services, non-profit organizations or real estate

What we like and what we don’t like

Backd works well for fast, short-term business funding, and many businesses can qualify especially for its working capital loan. But businesses with strong credit should compare other lenders to make sure they’re getting the best deal.

What we like

High maximum loan amounts. Maximum loan amounts vary by lender, but most don’t reach $750,000 for business lines of credit or $2 million for working capital loans like Backd does.
Funding within 24 hours. With immediate approvals and next-day funding, businesses won’t be left wondering how and when to fund their next purchase. Traditional lenders take anywhere from one to seven business days to approve a loan.
Flexible repayment features. If you choose a working capital loan, you can make daily, weekly or bi-weekly repayments. Most short-term loans stick to a daily or weekly schedule. And Backd’s unique buy now, pay later loan gives you the ability to pay for an item over the course of 12 months.

What we don’t like

Short-term loans only. Businesses can’t extend repayments beyond short terms up to 16 months. Longer terms would lower each repayment amount, making the loan more manageable for low-revenue businesses.
Few types of loans. Businesses will need to compare other lenders if they’re looking for multiple loan options in one place. For example, businesses may need a term loan, equipment financing and business line of credit to fulfill their financing needs.
Potentially high costs with factor rates. Traditional loans with an APR accurately represent the annual cost with additional loan fees, while a factor rate does not. Businesses should convert factor rates to interest rates and take other loan fees into account when compared to other loans.

How Backd compares to other lenders

Backd’s business funding may not offer the lowest rates, but it keeps its loans accessible to businesses with fair credit and relatively low revenue compared to other lenders. Here’s how Backd’s features compare to similar online lenders.

4.6

Bankrate Score

Loan amount

$10,000-$2 million
Interest rate

1.10-1.24 Factor rates | 30.00% APR
Term lengths

6-16 months
Min. time in business

1 year
Min. business annual revenue

$100,000

4.4

Bankrate Score

Loan amount

Up to $250,000
Interest rate

6.20% Simple interest
Term lengths

6 or 12 months
Min. time in business

2 years
Min. business annual revenue

$480,000

Read our review

on Bankrate

4.6

Bankrate Score

Loan amount

$5,000-$10 million
Interest rate

1.11 Factor rate
Term lengths

3 months-10 years
Min. time in business

6 months
Min. business annual revenue

$180,000

Read our review

on Bankrate

Backd vs. Bluevine

Bluevine specializes in business lines of credit, offering up to $250,000 with simple interest rates starting at 6.20 percent. Business owners can qualify with a 625 minimum credit score and $40,000 in monthly revenue, but only if they choose weekly repayments for 26 weeks. The criteria goes up significantly for the 12-month repayment term, such as requiring $960,000 in annual revenue.

Bluevine’s starting rates are superior to Backd’s business line of credit rates, which start at 30.00 percent APR. Yet Backd offers higher credit limits up to $750,000. It also keeps less stringent lending criteria, requiring only one year in business and $300,000 in annual revenue.

In short, Bluevine works best for established businesses with strong revenue. Backd works well for businesses needing a higher credit limit and relaxed eligibility requirements.

Backd vs. Credibly

Credibly works well for bad credit borrowers, approving those with credit scores as low as 550. It offers both conventional business loans like a business line of credit and working capital loan. But it also provides alternative financing through merchant cash advances and invoice factoring.

On the other hand, Backd is a solid option for those with fair credit, with its minimum credit score set at 600. It offers significantly higher loan amounts than Credibly. Most Credibly loans stop at $300,000 to $400,000. The exception is Credibly’s long-term loan, which offers funding up to $10 million. By comparison, Backd’s loans go up to $2 million. Its alternative financing is a buy now, pay later option that offers the chance to pay for an expense over the course of 12 months.

How to apply for a loan with Backd

According to its website, businesses can apply within three minutes online and receive an immediate response for whether the loan is approved. Backd conducts a soft credit check to review your credit for preapproval.

To apply, simply answer questions about your funding needs and provide basic personal information, such as your name, address and social security number.

Backd frequently asked questions

Backd requires a minimum personal credit score of 600 for its business line of credit.
Backd makes the process of getting a loan as simple as possible if you meet its lending criteria. Its criteria includes: a credit score of 600, one year in business and $100,000 in revenue for a working capital loan or $300,000 for a business line of credit.
None of Backd’s business loans require you to secure it with collateral. Compared to secured loans, unsecured loans offer a layer of protection against business assets getting seized. But you could get better interest rates with a secured loan.

How Bankrate rates Backd

Overall Score	4.6
Accessibility	4.9	Backd offers high loan amounts to businesses with relatively low revenue.
Affordability	3.3	Backd has high starting rates for its business line of credit. It also uses factor rates for working capital loans, which often come with high fees.
Transparency	4.5	The website goes into detail about the features of each loan it offers.
Customer experience	5.0	Borrowers get pre-approved for loans in minutes and typically get funding within 24 hours.
Flexibility	5.0	Backd offers flexible repayment features and unique options like a buy now, pay later loan.

Methodology

years in business

30+

lenders reviewed

loan features weighed

770+

data points collected

To select the top small business lenders, Bankrate considers more than 20 factors. These factors include loan amounts, approval and funding times, credit requirements, APR or factor rate ranges, fees, and easy-to-find rate and fee disclosures. Bankrate reviewed more than 30 lenders and gave each a rating, which consists of five categories:

Accessibility: Factors considered in this category include minimum loan amounts, approval and funding speed, minimum annual revenue and minimum credit score.
Affordability: This section measures interest or factor rates and fees.
Transparency: How easy it is to find important rates, fees and eligibility requirements are considered in this category.
Customer experience: Customer service hours, online applications and app availability are considered in this category.
Flexibility: This category considers factors like the number of loan products and ability to change payment due date.

Editorial disclosure: All reviews are prepared by Bankrate.com staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the lender’s website for the most current information.

Backd Small Business Loans: 2024 Review

The Bankrate promise

At a glance

Overview

Lender Details

Who Backd is best for

Who Backd may not be best for

Backd: in the details

Backd pros and cons

Pros

Cons

Business loan types offered

Business line of credit

Working capital

Buy Now, Pay Later

Loan quick facts

Backd business line of credit overview

Loan quick facts

Backd working capital overview

Loan quick facts

Backd Buy Now, Pay Later overview

Do you qualify?

What we like and what we don’t like

What we like

What we don’t like

How Backd compares to other lenders

Backd vs. Bluevine

Backd vs. Credibly

How to apply for a loan with Backd

Backd frequently asked questions

What credit score is needed for Backd business line of credit?

Is it hard to get a Backd business loan?

Does Backd require collateral?

How Bankrate rates Backd

Methodology

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